Abstract
The presence of the commodity future contracts in the financial markets gave rise to the idea of introducing Shari’ah compliant commodity futures in order to channel the investments from the oil rich Muslim countries. Bay al-Istisnais consideredan ideal contract for the commodity future contract as the nature of this mode of financing is similar to the conventional commodity future contracts. The main objective of this paper is to sort out the applicability of Shari’ah compliant commodity futures in the agricultural market and to highlight the issues that can arise from the application of the commodity futures. A content analysis on the current literature has been performed to achieve the objective. It is found that due to speculation activities in the current market, a separate market for Islamic future contracts is necessary. It is suggested that Istisna based future contracts can be traded in this market. This will help the buyer and seller of the agriculture based commodities to hedge against the price uncertainties.
Abidullah Khan, Abdul Rahman Nizamani, Irfan Ahmed Shaikh. (2019) The Applicability Of Shari’ah Compliant Commodity Futures In Agriculture Sector, The Scholar-Islamic Academic Research Journal, Volume-05, Issue-1.
-
Views
832 -
Downloads
59
Article Details
Volume
Issue
Type
Language
